Utility is the set of numerical values that
A) yields an absolute level of pleasure from a bundle of goods.
B) reflects the relative ranking of various bundles of goods.
C) describes how much more a consumer prefers one bundle to another.
D) yields a cardinal ranking of bundles.

Question

Quizplus · Accepted Answer

Utility reflects the relative ranking of various bundles of goods, rather than an absolute level of pleasure or a cardinal ranking of bundles. The concept of utility is used to explain how consumers make choices between different bundles of goods based on their preferences and the satisfaction or value they derive from them. Therefore, the best choice is B, which describes utility as a relative ranking of bundles.

Utility Is the Set of Numerical Values That